Five years ago, the Department of Human Settlements presented its Housing Consumer Protection Bill, which, as of March 2023 has yet to be signed into law. It replaces the Housing Consumers Protection Measures Act of 1998 (HCPMA), and will largely impact the compliance regime that is followed by house builders.
However, owners of such property, estate agents, conveyancers, and the Registrar of Deeds will need to adjust to how much this new law will impact them as well.
What the Bill will do
“The new Bill,” explains Meyer de Waal, Director of MDW, a firm of attorneys, notaries and conveyancers based in Cape Town, “is primarily designed to protect housing consumers and introduces effective regulation of the home building industry, strengthens the regulatory mechanisms, protects housing consumers, and introduces effective enforcement mechanisms and prescribes penalties or sanctions to deter non-compliance by home builders.”
Compliance-heavy
Reading through the Bill is somewhat hard-going, but essentially it appears to be far stricter in building compliance. This follows the collapse of a three-storey home in Lenasia in January that caused damage to surrounding properties and left one neighbour injured, highlighting that the industry definitely needs far stricter controls.
Commentary by those whose Lenasia homes were damaged is that they have no recourse in claiming for those damages, nor can they personally afford to take the matter legal, and this is complicated by speculation that the builder(s) may not have been registered with the National Home Builders Registration Council (NHBRC), whose role is to provide protection to housing consumers should home builders fail to comply with the existing Act.
Registration and enrolment with the NHBRC
Currently, home builders need to be registered with the NHBRC if they are building for a client, and every new home to be built must be enrolled with the NHBRC at least 15 days prior to construction. This enrolment insures against poor building practices and permits the NHBRC to conduct quality home inspections at various stages of construction. The Act in its current form does not, however, extend to owner-builders—those who build a home for their own occupation or a builder not registered with the NHBRC who assists the owner in building a home for their occupation—but under the new Bill they will no longer be exempt.
Notable changes
Against this background, the new Bill redefines the term ‘build’, which now refers to the building of new homes as well as the installation, repair, renovation, alteration or extension of a home. Owners will need municipal approval of proposed building plans.
Another new element to the Bill of particular importance to homeowners is that they will be protected for a period of five years against any major structural defects, from the time when construction commences until five years after completion of the building. “Homeowners will also have a two-year cover against leaking roofs, compared to the current one-year protection.
“It is interesting that the new Bill also states that damages caused by third parties, as well as fire, explosions or damages by floods or earthquakes, will not be covered, and also damages that occur if the homeowner has not maintained their property.”
Timelines monitored
One of the bugbears of residential property owners using building contractors is that builders often fail to meet their own set of building deadlines. “The new Bill addresses this by requiring reporting and greater accountability to ensure timelines are met,” says de Waal. “The Bill also provides for a grading scale and as such one can expect that service providers and builders may strive to achieve and maintain the highest level of standards and execution.”
"For the property industry, estate agents, financial institutions, and conveyancers will act as ‘compliance watchdogs,’ with punitive measures for non-compliance, according to de Waal." When the Bill is signed into law, a property seller must ensure that the property to be sold is compliant with respect to the requirements of the Bill, otherwise it may delay the transfer of a property sold.
Private Property highly recommends that housing consumers familiarise themselves with the Bill, noting that changes may still be introduced. If you are intending to build a home this year, it’s a good idea to at least have some idea of what you may be in store for and take precautions to avoid any contraventions should the Bill be signed into law.
